Health Savings Accounts
The Status Quo Is An Expensive Choice.
Health Savings Accounts (HSAs) hold $100 billion in assets1see Devenir research for reference., while 93% of accounts earn a negative real return since they don’t invest2Health Insurer Disclosures On Trend And Public Company Disclosures On Expected Long-Term Expectations..
Healthcare out-of-pocket costs for most are modest and highly correlated with age, gender, and coverage type.
Zach, age 40 is enrolled in a typical healthcare plan.
- His likely annual out-of-pocket costs are $200 to $800, approximately $400 on average based on his age, gender, and plan selection.
- Current HSA balance of $20,000 sits idle in cash, earning a negative real return.
- With $200/month in HSA contributions, and a 5% real return on his invested balance, he could have $192,000 dollars by the time he is eligible for Medicare. More than enough to offset premiums and copays1https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs.
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